Of all the things a mortgage accounting team should focus on, culture is arguably the most important. Culture defines how your team responds to things, good and bad.
Without a strong culture, your team may be able to do the work just fine. You can lull along, getting the work done and checking off the boxes. But culture is one of those things where that great phrase, "better to have it and not need it, versus need it and not have it" applies. Culture acts as the insulation layer in tough times, and acts as a turbo engine in good times.
In the tough times, culture dictates how your team deals with setbacks, how they adapt to unexpected changes, or how they lift each other up if others are struggling. In the good times, culture dictates how they celebrate each other's wins, how they are insatiable in improving the team, and how they care about their work.
The wonderful challenge about building culture is that for as important as it is, it is equally fragile. It can take time to build, but can be destroyed in a flash. How do you build strong culture then that will last and be resilient? I believe it comes down to this:
- Intellectual curiosity
- Entrepreneurial spirit
- Foundational competency
- Optimism
Intellectual Curiosity
I view the accounting team as the business's central nervous system (How nerdy, right?). A strong accounting team gives the brain... AKA the business owner or leadership team... information and feedback on how it's doing.
Seeing cash reserves getting dangerously low? Alert! Alert! Seeing certain product offerings generating way higher margin than others? Alert! Alert!
Intellectual curiosity matters because just like in the human body, no symptom is wholly isolated. That pain in your back is probably due to a pinched nerve up in your neck. That knee pain you're feeling is actually because your quadricep muscles are underdeveloped, putting too much strain on your patella (not medical advice...).
An accountant that is naturally intellectually curious will understand this interconnectivity much better and quicker than those who are not. He or she will be able to understand the big picture or the "why" better. For example, if the company is in the process of standing up a new credit line to fund mortgage loans, an intellectually curious accountant will make the connection to ask, "Are there legal fees we should be capitalizing?". And for new hires, this intellectual curiosity acts like learning grease, allowing the accountant to learn and master the concepts better and faster.
Entrepreneurial Spirit
Having an entrepreneurial mindset is not at odds with being on a team working for a company. To me, entrepreneurial spirit is really an embodiment of ownership, grit, and a bias to action.
Entrepreneurs cannot afford to sit in the proverbial high tower and pontificate on every decision they come across. Instead, they have to act. If you've been an entrepreneur or ever been around one, you'll know that they are always willing to roll up their sleeves and do the marketing, the sales, and the operations, in other words, whatever is required. They have a deep vested interest in the success of their business— oftentimes their family's well-being and fortunes depend on it.
As a team member working for a mortgage company, foster those traits that embody the entrepreneurial spirit. Own your work as if it was your name on the letterhead. Have grit and know that the first one, two, or three attempts to do something may not work, but you're eager to give it a try for the fourth time. Don't be reactive and wait passively for things to happen. Identify problems, build solutions, be relentlessly useful.
Foundational Competency
Simply put, hire the smartest people you can find who are also fun to work with (more on that next). Mortgage accounting is highly niche and very technical. On top of that, the industry has its own dictionary of lingo and terminology that is overwhelming at the start. This sort of combination is hard and it's quite a departure from what you learn in your accounting courses in school.
Take the concept of loan-level accounting. This is a fundamental accounting concept in mortgage accounting, where you record in your general ledger all the revenue and expenses associated with a loan based on the loan ID number. Not only does this let you see things like margin per loan, but specific loan-level ledgers are a firm requirement for certain regulatory requirements. This introduces a new sort of data analyst, system layer, to your accounting job that you probably did not experience in school. Add in the fact that companies can easily do tens to hundreds of thousands of loans that accumulate to over a million data points, and you'll quickly find the limits of something like Excel that accountants are familiar with. Because the job is hard, you need to hire or develop smart accountants who can understand the business, be equipped with the proper accounting foundation, and be savvy technologically to handle the volume of data and perform the work.
Optimism
In order to have strong culture, you need to have a place that's fun to work. I am certainly not saying you need to buy in to the "We're a family here" corporate slop that often gets parodied. I've found that the better balance is to not take what we're doing too seriously (We're not saving lives after all), crack some jokes, and be default optimistic. You can be smart, capable, and curious; but if you're no fun to work with, I would not want you on the team.
So be fun, have optimism and enthusiasm about what you're doing. Set the tone in your meetings instead of letting the tone be imparted onto you. Celebrate your wins and each other's wins loudly and proudly.
There are thousands of things I could continue to say about culture, but I'll leave it there for this post. Thanks for reading and I hope you found it helpful and interesting.
-Bennett